Home heating oil prices in Northern Ireland have hit a two-year high, it can be revealed.

Statistics provided for the Belfast Telegraph show that the last time costs were so high was during the 2008 heating oil shortage.

Prices are now averaging £440 for 900 litres and there are fears they could break through the £500 barrier as the cold snap tightens its grip.

The grim news comes as the first of this winter's cold weather payments have been issued to 52,000 vulnerable people across the province.

And it follows a Met Office warning that temperatures could reach -11C before the week is out.

“There has been a sharp rise in the cost of home heating oil and prices now look set to be at their highest level in over two years,” said an industry expert.

“Prices have increased by around £15 for 900 litres between Thursday and the weekend and are now at around £428, with possibly more price rises due.

“Fluctuations in the price of heating oil is due to the stock market and exchange rates, so it’s important to look at the price of a barrel of oil in pounds, not dollars. Oil distributors may lower their margins at off-peak times but this only represents a penny or two a litre and it wasn’t enough to stop the price of heating oil reaching highs of £600 in the summer of 2008.”

A spokesman for the price comparison website Cheapestoil.co.uk added: “Heating oil could easily reach £500 in Northern Ireland this Christmas as it has already reached this level in other parts of the UK.”

A straw poll of oil distributors has revealed that almost every local supplier has increased their prices since last Thursday.

Social Development Minister Alex Attwood has called a meeting with oil industry representatives scheduled for tomorrow. “I am extremely concerned about rising petrol and oil prices and their impact on fuel poverty,” he said.

David Blevings, NI Oil Federation spokesman, said prices are rising because wholesale costs are being passed onto distributors by the major oil companies.

“The local distributor has no control over rising wholesale costs; these move daily affected by global demand, supply and currency exchange,” Mr Blevings said.

“At our meeting with Mr Attwood we will explain how the local market operates and why the major oil companies are pulling out of Northern Ireland, which is due to poor returns in the downstream oil market.”